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6 Things Every Smart Woman Knows About Money

Competing priorities can make it really hard to manage your money. Maybe you still need to build six months of take-home pay in an emergency savings account. You might have student loans or credit card debt. You want to contribute to your retirement, prepare for having children, and buying a house.

Then there are distractions. I’m dying for that Céline bag! I have to see Hamilton! Suddenly, you’re unsure of any money decision. It’s tough. I totally get it.

So, where do you start? Here are six principles that can help you get on track:

1. Don’t fear your money.

I felt the most empowered with my money when I realized I wasn’t afraid of it—that it was a tool to help me accomplish my goals. Learning even the very basics of personal finance made me feel so much more in control. That’s one of the reasons I started LearnVest. Regardless of how much money you make, you can feel confident and make progress toward your goals, one day at a time—if you have a plan. Which brings me to . . .

2. Get yourself a plan.

People often make hasty financial decisions (e.g., forgoing a month of retirement savings for an Equinox membership) without taking a holistic look at their priorities. A plan helps you assess how much you can spend on the day-to-day, while also setting yourself up for the future.

3. Budgeting doesn’t have to mean restricting yourself.

People think of a budget as abstinence. But an effective, balanced budget should give you wiggle room for the things you enjoy—otherwise you’ll never stick to it.

4. Not all debt is equal.

There’s a difference between good debt and bad debt. Good debt is money you borrowed to pay for something that will boost in value—like a mortgage for the home you plan to stay in for many years. Bad debt results from things that aren’t likely to up in value, like your auto loan or credit card debt. Prioritize paying off bad debt, which typically has higher interest rates.

5. Know your worth.

6. Adjust your financial plan at every stage of life.

What worked in your 20s is not necessarily going to work in your 30s and 40s. So check in with yourself periodically—do you still want the same things you wanted five years ago? How about six months ago? If your life priorities have shifted, then so should your financial plan.